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What is the operating cash flow for this project in year 1? What is the operating cash flow for this project in year 2? What
What is the operating cash flow for this project in year 1?
What is the operating cash flow for this project in year 2?
What is the operating cash flow for this project in year 3?
What is the operating cash flow for this project in year 4?
What is the operating cash flow for this project in year 5?
Operating cash flow (growing each year; MACRS). Mathews Mining Company is looking at a project that has the following forecasted sales: first-year sales are 7,000 units, and sales will grow at 11% over the next four years (a five-year project). The price of the product will start at $124 per unit and will increase each year at 8%. The production costs are expected to be 60% of the current year's sales price. The manufacturing equipment to aid this project will have a total cost (including installation) of $1,300,000. It will be depreciated using MACRS, and has a seven-year MACRS life classification. Fixed costs will be $52,000 per year. Mathews Mining has a tax rate of 35%. What is the operating cash flow for this project over these five years? 3 What is the operating cash flow for this project in year 1? (Round to the nearest dollar.) $ MACRS Fixed Annual Expense Percentages by Recovery Class Click on this icon to download the data from this table Year 1 2 3 4 56 7 8 9 3-Year 33.33% 44.45% 14.81% 7.41% 5-Year 20.00% 32.00% 19.20% 11.52% 11.52% 5.76% 7-Year 14.29% 24.49% 17.49% 12.49% 8.93% 8.93% 8.93% 4.45% 10-Year 10.00% 18.00% 14.40% 11.52% 9.22% 7.37% 6.55% 6.55% 6.55%Step by Step Solution
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